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Mortgage life insurance pays out tax free a lump sum so that the outstanding mortgage balance on your home can be repaid to the mortgage lender in the event of death of the life assured. Mortgage Life Insurance is optional but if you do then it will give you and your family the peace of mind that the mortgage is paid off should you or a key family member die before the end of your mortgage term which can have a significant impact on the financial burden of the person left behind.
In addition to paying off the mortgage you may want to ensure that your family receive income after your death which this type of policy can also offer.
A decreasing term issurance policy is usually taken out to cover a repayment mortgage or other type of debt whereby the amount of debt reduces over the term of the loan or mortgage.
This is the least expensive type of insurance as the amount of potential payout reduces over time whilst payments remain the same. Unless there is a claim before the end of the term the insurance will simply expire. There is no investment element to these types of policy as the overall objective of mortgage life cover is to pay off the remaining mortgage amount should death occur.
A level term insurance policy pays out a tax free lump sum in the event of death of the life insured for a specific term which is usually the term of the mortgage. The amount you are covered for remains the same throughout the term of the policy. This type of life insurance policy is most suitable where the mortgage debt does not reduce throughout the term of the mortgage.
This could be when the repayment vehicle is an investment policy such as an endowment policy which intends to pay off the mortgage at the end of the term.
Another option is to take out a life assurance policy called a whole of life policy. This type of policy will pay out whenever you or the life assured dies. Premiums are more expensive than term insurance as the premiums are investment linked.
If you think that your family will be unable to manage on the income they have in the event of your death then Family Income Benefit is worth considering. Family Income Benefit is a term insurance which only pays out an income rather than a lump sum.
Critical illness Cover is an insurance policy which is designed to pay out a lump sum in the event that the policy holder suffers a critical illness and survives for at least 28 days after diagnosis.
The lump sum can be spent on anything but paying off your mortgage or improving lifestyle are the main objective as you may not be able to work after suffering a critical illness. It is designed to give people with mortgages some protection in the event that the policyholder cannot work.
Critical Illness policies cover the seven core illnesses but often providers will include more critical illnesses in the policy, but this varies depending on provider.
0There are over 200 variations of critical illness policies available so it makes sense to speak to one of our Independent Financial Advisers (IFA). A critical illness policy is usually linked to a term life insurance policy.
If you are unable to work due to sickness or disability then income protection insurance will help you pay the bills on a monthly basis up to a certain percentage of your annual income. Once your application has been accepted the policy cannot be cancelled by the insurer which means you have no concerns about the policy being withdrawn if you have health problems in the future. There is no limit with regard to the amount of claims you can make on your policy or the length of the claim period.
An Income Protection Insurance Policy can cover you up to retirement age and the premiums can be lowered if you defer the payout date if you make a claim.
If you are already receiving sick pay from your employer you cannot claim the full amount but you may be entitled to a smaller payout to top up what you already get. The policy is flexible enough to pay out a reduced amount even if you return to work on a part time basis following a claim.
If you are thinking of a less expensive short term option then Accident, Sickness & Unemployment cover (ASU) may be an option. This type of policy is renewed annually and will pay out for a maximum of 12 to 24 months after receiving your first payment. Although backdated to day 1, you can defer payments to 30, 60 or 90 days to make the policy less expensive.
You can claim just once on these policies and the insurer can cancel the insurance when renewal of the policy occurs annually.
Our Independent Financial Adviser will assess your needs and advise which is the best policy for you.
Home Insurance is a term for describing two different types of general insurance:
If you own your home then you may want to seriously consider having buildings insurance. Buildings Insurance covers the fabric of the house such as the walls (including windows and doors), floors and roof as well as permanent fixtures such as a kitchen or bathroom.
Here are some of the examples that this type of insurance covers you for:
This insurance covers you against loss or damage to your personal possessions which are inside your home and if included your garage and outhouses. Some insurance policies will give cover for items you take outside of the home such as laptops and mobile phones.
These are the main types of cover available:
Some policies include accidental damage, legal advice and cover, personal possessions and home emergency cover as an additional extra.
If you are looking for a high quality home insurance from a reputable insurer who has a high “pay out” claims percentage then speak to us today to discuss
Joint life insurance policies are needed when couples want to provide for each other in the event of death. There is nothing to stop you having two separate life insurance policies but joint life cover is less expensive than two separate policies because a joint life policy would pay out just once in the event of death.
The most common type of joint life insurance is a first death policy whereby the policy expires after the insurance company settles the claim after one of the policy holder dies. If both of the insured dies at the same time then the policy will still only pay out once.
Another combination is joint life “second death” which is also known as a survivor policy. This means that the life insurance policy will only pay out when the second person on the policy dies. The main advantage is that the premiums are less expensive as the life expectancy is extended.
Buying a property can be one of the biggest and most important decision people can make in our lives. Most of us will need a mortgage to buy our new home, whether it be a house, apartment or a flat and this is where we can help. We have literally thousands of mortgage products available from many mortgage lenders and you are best advised to obtain advice from an Independent Mortgage Adviser such as ourselves people who know how a mortgage works and our advisors can give you impartial, independent advice.
We can provide advice for every type of mortgage whether it be residential, buy to let, letting to buy, commercial and more specialist types of mortgage such as ex-pat, offshore and large loan financing.
Advice on mortgages is not just limited to rates and products so it is essential to assess lenders and their criteria. Being unaware of a lender’s criteria can result in a mortgage being declined, a loss of fees and have a negative impact on your credit record. Having advice helps to ensure that your mortgage is processed swiftly and you are successful in obtaining a mortgage offer.
Your home may be repossessed if you do not keep up repayments on your mortgage.
I can advise and arrange all kinds of insurances, including:-
It’s not compulsory to have any insurances (except buildings insurance, but how many times do you hear of a building falling down!), but you know it makes sense.
“It is better to have and not need, than to need and not have.”
